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Friday, July 31, 2009

Limiting health insurance companies

For some time now I have been complaining that one of the biggest issues in health care is that insurers need to be required to take any patient that wants in. Recently insurance companies have taken to refusing to cover people with pre-existing conditions, as well as trying to kick out those who are very sick. Allowing them to do so ruins the entire reason for insurance companies to exist. The healthy must pay for the sick in any reasonable insurance plan.

The House bill, for example, would require that all new policies sold on or off the exchanges must offer yet-to-be-determined “essential benefits.” It would prohibit those policies from excluding or charging higher rates to people with pre-existing conditions and would bar the companies from rescinding policies after people come down with a serious illness. It would also prohibit insurers from setting annual or lifetime limits on what a policy would pay. All this would kick in immediately for all new policies. These rules would start in 2013 for policies purchased on the exchange, and, after a grace period, would apply to employer-provided plans as well.

This one policy alone makes me support the Democrats plan. I am still a bit skeptical though for the plan as a whole. Any reasonable plan needs to ensure that the total costs of healthcare are kept down. So far I haven't seen any sign that the bills in congress take this seriously.